SACRAMENTO — Gov. Jerry Brown took a muted tone Thursday as he delivered his State of the State address to the California Legislature, urging fiscal restraint and reinforcing policy positions he has already articulated rather than proposing expensive new programs.
In a recurring theme that sets the stage for upcoming legislative debates, he called on lawmakers to find a permanent revenue source to maintain roads, bridges and other infrastructure that he said now need $77 billion in repairs.
Brown convened a special session on transportation last year and has called for a $65 annual fee on all vehicles and for higher gas and diesel fuel taxes.
Repairing the crumbling infrastructure is critical, he said Thursday.
“Yet, doing so without an expanded and permanent revenue source is impossible,” he told lawmakers. “That means at some point, sooner rather than later, we have to bite the bullet and enact new fees and taxes for this purpose.”
Other infrastructure needs include fixing what he called “serious deficiencies” in state office buildings, levees, parks, universities, prisons and state hospitals. The budget he proposed earlier this month includes using $2 billion of an expected state budget surplus to repair and replace aging state-owned structures.
Republican votes are needed to pass any tax increase but they remained skeptical.
With state revenue surging, they believe the state can afford to make repairs without new taxes or fees by shifting funds and cutting jobs at Caltrans.
“Last year he talked about transportation infrastructure and then did nothing except create an extraordinary session where he says you’ve got to raise taxes,” Sen. Bob Huff, R-San Dimas said after the speech. “Here we are again.”
Notably, Brown did not mention his increasingly unpopular $68 billion bullet train plan.
Instead, he continued his call for fiscal prudence, a hallmark of his speeches since he returned to the state Capitol in 2011 after previously serving from 1975 to 1983.
He urged lawmakers to beef up California’s rainy day fund, warning that the California economy could quickly be upended by seemingly unrelated world events.
“A slowdown in China or turmoil in Iraq or Syria, or virtually anywhere, can send the stock market reeling and put California jobs and state revenues in jeopardy,” Brown said in the speech devoid of his typical rhetorical Latin and biblical references.
The 77-year-old Democratic governor decried the wage stagnation and inequality he said have plagued many Americans and outlined the state’s response to those issues, including a higher minimum wage, stronger wage laws protecting unionized workers, and an earned income tax credit for the working poor.
To address poverty, he said, California has “wholeheartedly embraced the Affordable Care Act,” enrolling 13.5 million Californians in Medi-Cal and another 1.5 million in Covered California. He called it a historic achievement that will provide health security to those who could not otherwise afford it.
But he also noted that Medi-Cal costs have grown by $23 billion in four years and called on lawmakers to pass a new $1 billion tax on health insurers to replace one that is expiring.
Republicans also oppose that plan, though Democratic legislative leaders said they are confident they can negotiate a compromise with the GOP.
Republican lawmakers argued that the state can use rebounding revenues to fund programs.
“Gov. Brown and I agree on a number of issues but we differ on our solutions,” Assembly Minority Leader Chad Mayes, R-Bakersfield, said in a prepared statement. Republican “solutions to lift people out of poverty involve job training and incentives that create local jobs.”
Democrats have pushed to spend some of California’s burgeoning tax revenue to aid social programs and to increase the stock of affordable housing, particularly in areas such as San Francisco and Silicon Valley where the cost-of-living is among the highest in the nation.
“We believe that we need to make targeted investments in human capital for those who have been left behind with the resurgent economy,” said Senate President Pro Tem Kevin de Leon, D-Los Angeles.
Brown is in his sixth year as governor and will leave office after this term, though he joked about using his sizeable campaign funds to try to change the state constitution to allow a fifth term.
He retains immense political clout, along with at least $24 million in his campaign bank account, which Brown can use to support or oppose any of a slew of initiatives making their way to the ballot this year.
In his speech, Brown only touched on his controversial $15 billion twin-tunnels plan to ship water from the San Joaquin Delta to Southern California.
Environmentalists have said the project would endanger fish and other wildlife.
Brown ended by praising the state’s progress in areas such as increasing school funding and combatting the “overarching threat of a warming climate.”
However, those advances could be shortchanged in the next economic downturn, he warned.